Huriwa Logo

Tuesday, 20 November 2012

Nigeria: Small business as key to youth employment By Emmanuel Onwubiko & Sylvia N. Okonkwo, esq

Those who know defined small businesses as companies that each
employs less than 100 people. Researchers that work with
http://www.evolveyourbiz.com/ are of the knowledgeable position that small
businesses in the United States is key to job creation and indeed are
credited for creating nearly fifty percent or more of the entire jobs in the
United States economy. According to them, in the USA, small business employs
over half of the nation's workforce.

Writing further on the importance of small business to the United
States of America's economy, these group of thoroughbred researchers affirmed
that though many people still think that new industrial giants are the most
important factor in driving the economy, but the truth is that small businesses
are actually the 'top dog'. "Where would half of the nation's actively
working population find gainful employment opportunities without the formidable
presence of the small businesses?"

Other researchers as well as the ones being referred above are of
the opinion that entrepreneurs are the backbone of creativity and production
because of the undeniable and scientifically verifiable fact that over 60% of
all private sectors, non-farm jobs comes from small businesses and this salient
fact informed the claim by experts that small businesses are critical to the
United States economy.

Back home in Nigeria, small scale or small medium enterprises are
common means by which many are making a living in the country. Known as the
most populous country in Africa with about 162.47 million people, Nigeria
churns out graduates from tertiary institutions with little or no job waiting
for them in the labour market. The National Bureau of Statistics said that over
50% of youth in Nigeria are jobless even as the World Bank by some estimates
say 56% of Nigerian youth are jobless.

The MO IBRAHIM Foundation established by the Sudanese-born but
United Kingdom-based investor- Dr. MO Ibrahim has in the 2012 report on
the future of the African youth painted graphic and grim picture that the
educational system in much of the African countries including Nigeria are not
structured in such a model as to produce graduands who are comprehensively
groomed with the twenty first century compliant skills to become creative and
imaginative entrepreneurs.

MO Ibrahim canvassed
urgent measures in the area of providing good governance models that are
workable so that quality education, health and opportunities for gainful
employments are created for the youth to enable them compete with their
counterparts around the globe. According to MO Ibrahim foundation, most youth
in Africa including Nigeria with the highest population of black people in the
World, are endangered by realities not unconnected to governance. This report
revealed that the median age of African leaders is three times the median age
of African population; Africa's current educational levels are lower than
China's and India's; Secondary school achievement has regressed, as nearly nine
million primary school age Children are out of school in Nigeria with only2/3
of students progressing from primary to secondary education.

MO Ibrahim Foundation also found out that job readiness is lacking
in Nigeria, Kenya and Egypt while sectors that drive Gross Domestic Products
growth do not create the most jobs. To cap up these pathetic statistics, MO
Ibrahim Foundation uncovered that Africa has the lowest share of Engineering
graduates in the World and that West and Central Africa lags behind literally
when compared to East, Southern and Northern Africa. These factors grossly
discourages the growth of small businesses among Nigerian youth who in their
millions roam the streets of Nigeria searching for the elusive white collar
jobs rather than being encouraged and empowered to become investors and small
business operators.

Even with the constraints of lack of finance to start up
successful small business enterprises, many Nigerian youth still turn to the
establishment of small and medium enterprise to sustain themselves. However,
many who do not have formal education but are business minded are finding their
way into the small scale or small and medium enterprise. The Government and
other policy makers must find ways of educationally and financially empowering
the millions of Nigerian youth who are already involved in small businesses and
also encourage others to join this noble enterprise of running small
businesses.

A small scale or small or medium enterprises in Nigeria could
range from manufacturing plastic sealed water, popularly known as “Pure
water”, to leasing or renting an office space for wholesale, retail or social
or consultancy services.

Indeed, small and medium scale business/Enterprises (SMEs)
anywhere in the world serve as a very potent force for job creation, poverty
alleviation and overall healthy economic growth, and in the case of Nigeria, a
thriving small business sector holds the key to ending the vicious cycle of violence,
terrorism and youth restiveness.

The positive development in this regard is that the
government departments, especially at the federal level, are neither
relenting nor giving up their bid to revamp and invigorate the fortunes of SMEs
as to enable them play the expected role in Nigeria’s economic growth and
development but the commitment to make sure that the right persons benefit from
the various schemes already in place in Nigeria is grossly lacking due to
nepotism, greed, corruption and absence of good governance which are some of
the salient constraints pointed out in the MO Ibrahim's report as being
responsible for the backwardness of the Nigerian youth.

On the part of the Nigerian government, officials are of the view
that different steps are being taken to address and redress these anomalies
with a view to making the youth successful owners of small businesses. This,
according to these Nigerian government officials, is evidenced by the
government’s recent innovative job creation mechanisms as well as the mandate
given to the Bank of Industry (BOI) and the Small and Medium Enterprises
Development Agency of Nigeria (SMEDAN), the facilitation of the Banker’s
Committee's Institutionalization of the Small and Medium Industry, Equity
Investment Scheme (SMIEIS). But these elitist measures have not trickled down
to the millions of jobless Nigerian youth.

The enormity of the crisis of youth unemployment is however not
being properly confronted with the necessary tools to reduce the scourge by encouraging
the youth to become successful small scale business owners through the
implementation of a variety of tax incentives and benefits including workable
welfare schemes to enable unemployed youth meet up with payment of some
important bills and also participate in the administration of small businesses
as owners and consumers. Till date some foreigners are actively involved in the
setting up and running of small businesses such as supermarket retail outlets,
restaurants and bakeries. It is only in Nigeria that such things are encouraged
when the local youth are roaming the streets jobless and government is looking
the other way and allowing all manner of unqualified and unskilled persons from
foreign jurisdictions to invade the Nigerian local markets. The Federal
Ministries of Labour/productivity and Internal affairs must be reorganized
to guide against abuses of expatriate quota that has become pervasive in
Nigeria.

Still on the issue of small businesses, President Goodluck
Jonathan recently introduced the YOUTH ENTERPRISE WITH INNOVATION IN NIGERIA
[YOUWIN] which is a joint initiative of the Federal ministries of Finance;
youth affairs, Women affairs and Communication Technology. The programme is to
encourage and support ambitious and creative enterprising young men and women
to develop and implement business ideas for job creation. Government officials
say the initiative if properly implemented is envisaged to last for a three
year period in which the second cycle would be completed in 2013[September] and
that between 80,000 to 320,000 new jobs will be created at the cost of N10
billion.

If you ask us, we will simply see this modest effort by the
current administration as 'mere tokenism' because only recently the entire
country was inundated with information that few members of the criminal
petroleum importation gangs with active patronage of some influential
government officials cornered nearly N1 Trillion of tax payers money in
fictitious fuel subsidy claims and that the Central Bank of Nigeria and the
relevant government agencies including the Petroleum Products Pricing and
Regulatory Agency [PPPRA], the federal ministry of Finance[before arrival of
Dr. Mrs. Ngozi Okonjo Iweala as minister] and the office of the Accountant
General of the Federation authorized these dubious payments to these cartel
that collected huge payments for services and supplies of products that were
never made. Why then is the Federal Government dedicating only N10 billion that
can barely scratch the surface to tackle such a monumental national security
threat posed by youth unemployment even when leakages and willful corruption by
Government officials have depleted billions of tax payers fund through the
collusion and active participation of rogue government officials who still hold
influential positions in today's corridors of power?

Government is hereby implored to broaden the scope of the youth
enterprise with innovation in Nigeria project so as to create millions of small
business owners among millions of unemployed Nigerian youth because the issue
of joblessness among the youth is a serious national emergency that if not
tackled by all stakeholders could spell doom for our nation in the nearest
future.

Federal Agencies such as the INDUSTRIAL TRAINING FUND [ITF], the
National Directorate of Employment must be properly funded so that they
can also expand the scope of some of their ongoing youth job creation
initiatives. The ITF is one of the few agencies of the Federal Government that
have carved a niche for themselves for actually implementing their mandates.
The ITF is in the process of training thousands of unemployed Nigerian youth in
skill and vocational sectors to become self employed. Such patriotic, creative,
productive and good project needs to be given bigger budgets and
realistically/pragmatically and transparently used to train and empower the
unemployed Nigerian youth to become successful small business owners.

The Business day of 14th February 2012, reported that the National
Directorate of Employment (NDE) disbursed N2.8 Million for four unemployed
graduates in Cross River State under its Enterprise Creation Fund (ECF) for
small and medium Enterprises. Edem Duke, the Coordinator of the Directorate in
the state disclosed in Calabar that the loan was to enable each of the
beneficiaries who received N700,000 to start their own business. What can this
little effort do in ameliorating the dangerous trend of youth unemployment?

The NDE office in Cross River State explained thus; “We expect
that the young graduate will use the money to set up their business, run
them prudently in line with the training given, and pay back the money on
time”. They were given moratorium of six months on the loan repayment and are
expected to complete the repayment in two years. Again, 100 unemployed youths
in the state were undergoing training which was tagged as unemployed Rural
Youths Centered on hair dressing fashion designing, carpentry, Electrical
Installation, welding and metal fabrication.

Recently, Director General of the National Directorate of
Employment, Mallam Abubakar Mohammed, launched some new job creation Schemes
aimed at supporting the cashless economy programme of government. It floated
the QIK-QIK and Easy-BIZ Business ownership schemes all designed to create
employment opportunities for Nigerian graduates in the cashless economy platform.

He stated that micro-business concerns created by the NDE have
enjoyed the privilege of exposure to some of the best world-class business
platforms. "NDE beneficiaries are regular participants/Exhibitors at the
three major international trade fairs in Nigeria namely, Kaduna, Enugu and
Lagos International Trade Fairs. The cost of participation in these
International business gatherings which may be beyond the economic muscles of
the young NDE supported entrepreneurs is made easy by the directorate, it buys
pavilion and allows it’s beneficiaries to exhibit their goods and services
therein at no cost to them".

These facts if verifiable is commendable but again should be expanded
to cover more unemployed youth because youth unemployment is a big national
calamity.

Through the establishment of manpower development support schemes,
and their involvement in the training and retraining of entrepreneurs, Small
and medium business have provided pool of potential entrepreneurs and business
people who are well equipped to start and successfully manage industries
whether small or large, not only in Nigeria, but worldwide. Successful business
people in Nigeria like the Aliko Dangotes, the Alex Ibrus, Mike Adenugas,
Illodigwes and the Orji Kalus started as Small and Medium Enterprises (SMES),
before the growth of their various businesses into Conglomerates. These big
businesses that commenced as small businesses are today big players in the job
creation market.

Small business, according to economists, will reduce the
dependence in government and large firms on salaries employment. It will
stimulate rural development and the achievement of a meaningful level of broad
economic and rural development, which will reduce the migration from rural to
urban centers, once infrastructural facilities are provided like access to good
road, communication facilities like telephone, postal services, provision of
electricity and water expansion schemes. In this regard, the second tier of
Government and even the third tier which are the States and Local Government
structures must wake up and create the enabling environment devoid of
corruption and multiple taxations for small businesses to grow in their areas
of
jurisdiction.

Small businesses also ensures that the dignity of labor
and human dignity as enshrined in relevant provisions of the Constitution of
Nigeria in chapters two and four, would have been uplifted. Small businesses,
in the thinking of some economists creates what they branded as the spirit
of “ME TOO”, I can do it attitude.

Successful small business ownership by the youth will infuse
in them the passion and the psychological joy in working for themselves
and seeing their businesses grow and mature to conglomerates and derive joy in
being sources of employment to other Nigerians. Anyone watching Aliko
Dangote; Mike Adenuga, Cosmas Okoli; Orji Kalu can see happy people who have
worked so hard to start up small businesses that have today grown into
conglomerates that have created gainful employment opportunities to millions of
Nigerians in the construction, transport, media, manufacturing and
telecommunications sectors of the Nigerian economy.

No gain saying that small businesses will upgrade the social
status of every Nigerian Youth, by showcasing them as very successful
entrepreneurs and operators of small scale industries.

It is our considered opinion that for Nigeria to attain
greater heights as a great economy, it should make herself Small medium
enterprise (SMEs) driven economy that is adequately supported by the needed
Fund in addition, the government should encourage the creation of more
micro-Finance banks that are well supported and regulated to render necessary
financial supports to the right prospective beneficiaries with workable
business blueprints to drive the Nigerian economy and create sustainable jobs
for the youth.

We think that entrepreneurship will teach the Nigerian Youths
essence of business, which is finding a human need and filing it. A healthy
society then can be created as the entrepreneurs go to work.

The Individual Nigerian Youth will learn to have status that are
legitimate and functional. “This is the secret of learning to float while all
boats capsize”, so says the wise aphorism.

1 comment:

Thanks for share this post I also share with you something hope you like my post. A Lease for More than Two Years: Getting stuck with a long-term lease is a terrible burden for all small business owners. If you need to break the lease for any reason you will have to keep paying on the lease until the landlord can rent the space to someone else. Thanksequipment vendors

HURIWA'S WORKING VISIT TO ICPC ON THE 27TH MARCH 2013

HUMAN RIGHTS WRITERS' ASSOCIATION OF NIGERIA; HURIWA, ON DECEMBER 12TH 2012 VISITED THE DIRECTOR GENERAL OF NATIONAL EMERGENCY MANAGEMENT AGENCY[NEMA] ALHAJI MOHAMMAD SANI-SIDI ON THE CELEBRATION OF WORLD HUMAN RIGHTS DAY TO CONFER ON HIM THE HUMAN RIGHTS PERSON OF THE YEAR 2012 BY THE ORGANIZATION. THE DG PROMISED TO TAKE DISASTER MANAGEMENT LESSONS TO ALL PARTS OF NIGERIA. HURIWA WAS LED BY ITS NATIONAL COORDINATOR COMRADE EMMANUEL ONWUBIKO.